Latest data released by Markit/BME - 3 September 2021
- Composite PMI 60.0 vs 60.6 prelim
The preliminary report can be found here. A lower revision relative to initial estimates but the German services sector continues to post a strong expansion, reaffirming the recovery since the latest reopening and easing of virus restrictions.
That said, rising cost pressures may pose a challenge in the months ahead.
Markit notes that:
"The service sector followed up July's record performance with another sharp increase in business activity in August, and has taken the mantle from manufacturing as the main driver of growth. Although the rate of expansion on a monthly basis looks like it has passed its peak, the scene is already set for strong growth in the third quarter, even if we were to see a further loss of momentum in September.
"The Delta variant is a risk to service sector demand in the near term. But looking further ahead, businesses remain optimistic that conditions will have improved come this time next year, with many still hoping for an end to the pandemic and an associated recovery in travel activity. The steep rebound in activity and strong business confidence about longer-term prospects continue to help drive a rapid pace of job creation, albeit with the rate of employment growth in August easing from July's all-time survey high.
"Price pressures remained historically elevated across the service sector in August, adding to even stronger inflation in manufacturing. Large numbers of services firms continued to hike their prices to cover against rising costs, emboldened by rising demand and growing backlogs of work."
